Commercial real estate firm Goodegg Investments acquired three hotel assets via Goodegg Diversification Fund III: a SpringHill Suites and a Holiday Inn in Terre Haute, Ind., and a Homewood Suites in Lafayette, Ind. Other terms were not disclosed.
Goodegg Investments is a women-owned and women-led commercial real estate private equity firm founded by Julie Lam and Annie Dickerson. Since its inception in 2018, Goodegg Investments has built a portfolio totaling more than $1.4 billion across hotel, multifamily and self-storage assets, focusing on real estate syndications.
A real estate syndication is a type of investment that involves bringing together a group of individuals—usually between two and 10 people but sometimes as many as hundreds of investors—to pool their money and purchase a property. Rather than an individual investing in a single-family rental property on their own, they can pool their money together with other real estate investors and invest in larger assets (like an apartment building) together. The property is then owned and managed by the group, with each limited partnership member sharing in the profits (or losses) generated.
“Your investments should cater to you and your life, not the other way around,” Dickerson said in a statement. “One of the best parts of investing in a real estate syndication is that you can invest anywhere in the country, not just where you live. That means you can live in an expensive area like San Francisco or New York City, but you can diversify by investing in different asset classes in growing markets like Arizona, Texas, and the Carolinas.”
Real estate syndicates are typically led by real estate developers or sponsors who have a solid track record and expertise in commercial real estate. Investors provide the capital needed to purchase and redevelop the property. Meanwhile, the sponsor is responsible for acquiring the property, overseeing its renovation or development, property management and following through on the predetermined exit strategy. In exchange for their investment, individuals will receive a percentage of ownership in the form of equity units or shares. These units entitle them to a portion of the rental income generated by the property as well as a share of the profits if and when the property is sold. Group investments in commercial real estate offer the potential for high returns, with investors in a real estate syndication deal typically seeing annual returns of 8 to 12 percent, and sometimes even higher, according to Goodegg.